Webcast: OEE Calculator – Measure the Financial Impact of OEE Improvements
By Michael Hatto
October 5, 2022
Do you have an OEE calculator?
As an Operations or Production professional, can you convince key stakeholders of the financial impact of OEE improvements?
Listen to TBM Operations consultants share their framework for demonstrating process improvements in financial terms. Learn how to build an OEE calculator that will transform “cost” discussions into “investment” decisions. You will leave understanding how to quantify the benefits of OEE improvements for senior management.
In this webcast you will learn how to:
Pinpoint improvements that can lead to large returns
Identify and review the low-hanging fruit in OEE improvements
Uncover the 6 biggest losses – and how measuring OEE can stop the bleeding
Narrow OEE initiatives to best support overall business goals
Convince senior management that OEE improvements can — and should be — a top priority.
Why is it important to translate OEE improvements into financial impact?
It is important to translate OEE improvements into financial impact because OEE percentages alone do not show how performance affects the bottom line. The video explains that leaders need to understand how gains in availability, performance, and quality convert into increased capacity, reduced cost, or avoided capital investment. When OEE is tied directly to financial outcomes, it becomes a strategic business metric rather than just an operational score.
How do improvements in OEE create measurable financial value?
Improvements in OEE create financial value by increasing effective capacity without adding equipment or labor. The video highlights that reducing downtime, speed losses, and defects allows manufacturers to produce more sellable output with existing assets. This additional capacity can support growth, reduce overtime and expediting, delay capital spending, or improve margins, depending on how it is used.
What is required to accurately calculate the financial impact of OEE gains?
Accurately calculating the financial impact of OEE gains requires understanding where capacity is constrained and how additional output affects the business. The video emphasizes identifying bottleneck equipment, quantifying recovered production time, and linking that time to revenue, cost savings, or capital avoidance. Without this connection, OEE improvements risk being undervalued or overlooked by leadership.
Mike Hatto is a client manager and long-time lean subject matter expert with a wealth of hands-on operations experience. He has been instrumental in implementing project based improvements that yield high return rates in short timeframes.
